Shark Tank, one of the highest-rated programs on television for the past 10 years, is a real eyeopener that shows viewers just how tough it is to launch and operate a small business. The “sharks” are business moguls who took various paths to reach the pinnacles of success. They are experts in their fields and invest in small businesses that have the potential to grow and become wildly successful. When up and coming entrepreneurs “enter the tank” to present their products and ideas, the frenzy begins. Being attacked with questions by the sharks can be brutal if you’re unprepared and present a weak case for your business concept. The presenters must take the heat long enough to persuade one or more sharks to invest time and money in their fledgling business. The stakes are high. How people presents themselves and respond to questions can lead to success or failure.
Special “life after” segments of Shark Tank give an in-depth look at what happens to businesses lucky enough to receive financing and mentorship. In these teachable moments viewers get to a chance to see the impact small businesses have on their communities and the people they employ. Granted, these businesses are not the norm since they are pre-destined to succeed based on the expert marketing and promotional support they receive through the TV show. Even under these circumstances, it’s good to see small businesses shine.
State of Small Business Survey
But, what is really on the minds of small business owners? It’s been an unpredictable year fraught with business reforms, political upheavals and natural disasters. Yet, the business community exudes confidence and believes the economy will continue to grow.
To gain greater insight into small business trends, Guidant Financial partnered with LendingClub, an online lending marketplace, to conduct the State of Small Business survey. More than 2,600 business owners from across the nation responded.
Who’s Starting Today’s Businesses?
Watch the news and you’re led to believe start-ups are only launched by millennials and Gen X entrepreneurs that look like Mark Zuckerberg. But, here are a few facts from the survey that give a big picture perspective of the ages and faces behind America’s upswing in small businesses.
- 27% of respondents were ages 40-49
- 33% of respondents were in their 50s
- 21% of respondents were 60 and over
- 82% increase in respondents who identified as Hispanic and African American
How Big are the Operations?
In terms of staff, 34 percent of operations are relatively small with the owner being the sole employee. More than 44 percent of the businesses had two to five employees. Even so, these businesses had a tremendous impact on the economy. According to the Small Business Administration (SBA) they represented over 63 percent of the new jobs created during the past six years.
Top Five Business Categories
Survey respondents ranged from owners of mom and pop shops to franchises to home-based businesses. Although, not shown below statistically, the SBA reports ninety-eight percent of high-tech companies are small businesses. Based on survey results, these are the top 5 industries.
- Business Services 11%
- Food/Restaurant 10%
- Health/Beauty/Fitness 7%
- General Retail 7%
- Automotive 6%
College is Not a Necessity
The results from several high-profile surveys, including one conducted by CNBC (https://www.cnbc.com/2017/07/19/survey) indicate that many business owners had not earned a college degree. The State of Small Business survey conducted by Guidant Financial and LendingClub showed similar results.
- High School/GED 34%
- Associate’s Degree 20%
- Bachelor’s Degree 28%
- Master’s Degree 15%
- Doctorate Degree 3%
Biggest Challenges for Business Owners
Getting the capitol needed to grow and expand is one of the biggest challenges facing small business owners. But, that doesn’t deter them from seeking the resources they need to move the business forward. The survey identified three major challenges.
- Lack of capitol/cash flow 67%
- Marketing/Advertising 28%
- Time Management 24%
Key Motivators: Happiness and Independence
Despite challenges, business owners are happy they made the leap and took the risks inherent in becoming an entrepreneur. According to the survey, “75% of all business owners rated their happiness level as an 8 or above on a scale of 1-10.” Not only are they happy, respondents are confident small businesses will thrive even when faced with unpredictable factors that impact the business climate.
- Want to Be Own Boss 49%
- Ready to Pursue My Passion 45%
- Opportunity Presented Itself 36%
- Unhappy with Corporate America 21%
- Lost Job/Outsourced 12%
Even for those entrepreneurs who host Shark Tank every week, operating a successful business is no piece of cake. But, the results of the State of Small Business survey clearly show that being your own boss has its challenges and rewards.